United States: ISM manufacturing index tapers in November but remains upbeat
The Institute for Supply Management (ISM) manufacturing index decreased to 57.5 in November from 59.3 in October, slightly missing market expectations of 58.0. Nevertheless, the index remained well above the 50-threshold that separates expansion from contraction in the manufacturing sector.
November’s pullback was the result of weaker growth in new orders and production, while employment levels declined relative to the previous month. That said, backlogs of work increased in November as did new export orders. On the price front, input prices rose on the back of higher raw material prices.
Commenting on the state of the manufacturing sector with regard to November’s print, analysts at Goldman Sachs noted:
“The composition of the report was weak, with declines in the production, new orders, and employment components. Construction spending increased in October by more than expected, with September revised down and August revised up. Following today’s data, we left our Q4 GDP tracking estimate unchanged at +3.2% (SAAR). Our preliminary November Current Activity Indicator now stands at +4.3% (vs. +7.2% in October).”